Novogratz to Create $250 Million Crypto Credit Fund
Galaxy Digital, a company owned by crypto investor Michael Novogratz, is going to raise at least $250 million in investment to create a cryptocurrency credit fund. The fund will help crypto companies to survive the crypto winter.
According to The Business Insider, a cryptobank Galaxy Digital will provide money to cash-strapped blockchain firms. In particular, potential borrowers will be able to offer cryptocurrency assets, property, and even miners rigs as collaterals.
Now, the Novogratz’s bank already provides loans. But it does it, using money from the own balance sheet. According to The Business Insider sources, the demand for crypto credits has increased significantly.
Galaxy plans to complete the first round of investment raising in March of this year.
Since the beginning of 2018, the collapse has continued on the cryptocurrency market. Over the past year, BTC has lost more than 80% of its value, and altcoins have fallen in price by 90% or more. The crash hit hard the crypto companies, especially those who tied their income to the crypto prices. In this reality, the crypto business is desperately seeking money to maintain its activities. A loan is one of the ways out of this situation.
In early August 2018, Galaxy Digital conducted a reverse merger with Canadian company Bradmer Pharmaceuticals. It allowed Novogratz to enter the Canadian stock market. At that time the shares of Galaxy Digital traded at 3.03 Canadian dollars. By January 25, 2019, shares price has dropped to 1.49 Canadian dollars.